Last year, when Apple rolled out a new model of its tablet, the decision was not terribly complicated--either you bought the new version or you didn't. This time around, though, Apple has not only introduced but kept around the iPad 2--or at least, it kept around two versions of that tablet. So it's not just a question of which model iPad to purchase: You also have to figure out if the 16GB iPad 2 and its reduced price tag prove to be more appealing than the latest version of Apple's tablet.
First, the basics: Apple only offers the iPad 2 at one capacity now--16GB, with the Wi-Fi-only version priced at $399. A version of the iPad 2 that also includes the ability to connect to 3G networks costs $529. Comparable models of the new iPad cost $100 more--$499 for the Wi-Fi-only 16GB version and $629 for one that can connect to cellular networks.
Jason Snell's goes in-depth on the merits of the latest version of Apple's tablet. (And his from last year is worth reading if you'd like to know about that version's strong points.) As for making any iPad 2-versus-iPad comparisons, I find the best way to settle the issue is to ask a few questions about your plans for your new tablet.
The most important factor to weigh is what you'll use your shiny new tablet for. If you want to use it for watching movies, playing games, reading books, surfing the Web, checking email, and the like, the truth is you'll be well-served by either version of the iPad. Text will look a smidgen crisper on the new iPad, as will videos, photos, and any apps optimized to take advantage of the new iPad's Retina display; you'll see even more detail in high definition movies or when looking at photographs with the new iPad, too. But many folks have contentedly used the iPad 2 for a year or longer, without finding that the non-Retina display employed by that older model looks blurry or unclear.